Type 2 diabetes mellitus (T2DM) is reaching epidemic proportions in United States, creating a significant adverse effect on both its health and financial stability. One of the earliest events in the development of T2DM is insulin resistance, i.e. an inability of the hormone to suppress hepatic glucose output and to stimulate the uptake of glucose into muscle. Few drugs are available to treat the insulin resistance of T2DM and other related metabolic diseases. The most commonly prescribe drug, metformin, has been available for 50 years and still is useful in reducing blood sugar in diabetic individuals. However, many patients cannot tolerate metformin, and, even when efficacious, it usually needs to be eventually supplemented with other classes of therapeutics. The mechanism by which metformin reduces glucose production by the liver is poorly defined and remains controversial. The rationale underlying these studies is that by understanding the biochemical steps that metformin utilizes to educe beneficial effects on liver glucose and lipid metabolism, we will identify promising new drug targets. The initial approach to examining metformin's action is based on a novel experimental system that utilizes stable isotopes to map out the flux of simple precursors into glucose and fatty acids. These experiments will be performed in primary hepatocytes isolated form mouse, as these are likely to offer the best reflection of physiological events. The approach will be to challenge hepatocytes with varying concentrations of metformin and to monitor the flux of 13C-precursors though metabolic intermediates into glucose and lipid. These experiments should indicate the biochemical steps modulated by metformin. Putative regulatory sites will be validated by targeted mutagenesis of the responsible enzymes. To address one known candidate for an intermediate in metformin action, we will assess the ability of metformin to carry out its actions in liver cells deficient for the AMPK-activated protein kinase (AMPK). We will ascertain whether AMPK is a reasonable target to which to develop drugs that mimic the beneficial effects of metformin. Through these experiments we will identify targets for the development of novel therapeutic agents for the treatment of T2DM.